Corporate Crime & Investigations Update - 30 June 2017

Included in this issue: New Money Laundering Regulations 2017 are now in force; Banker sentenced to six years in prison for bribery scam; FCA publishes new cyber security guide for firms and more...

Money Laundering

New Money Laundering Regulations 2017 are now in force

The Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (SI 2017/692) ("Money Laundering Regulations 2017") came into force on 26 June 2017. This transposes the 4th Money Laundering Directive into the UK, replacing the Money Laundering Regulations 2007 (MLR 2007) and the Transfer of Funds (Information on the Payer) Regulations 2007 which were previously in force.

JMLSG publishes final guidance

The JMLSG has published its final revised Guidance, which will shortly be submitted to HM Treasury for Ministerial approval.

The revised Guidance reflects the provisions of the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017. It also takes account of the draft Risk Factor Guidelines published by the European Supervisory Agencies in October 2015, which at that time had not yet been published in final form.

FCA webpage on notification requirements for FSMA authorised firms

Under the provisions of the new money laundering regime, authorised persons are required to inform the FCA if they are undertaking Money Service Business (MSB) or Trust or Company Service (TCSP) activities, where such activities fall outside of their FSMA permissions.

To allow for this, the FCA has published a new webpage on the notification requirements for persons authorised under the Financial Services and Markets Act 2000 (FSMA).

Joint Committee of European Supervisory Authorities' final report on MLD4 AML and CTF risk factor guidelines

Joint European Supervisory Authorities have published guidance on the factors that credit and financial institutions should consider when assessing money laundering and terrorist financing risks relating to individual business relationships and occasional transactions.

The guidance seeks to provide assistance to firms in respect of what they should do when risk assessing individual business and occasional transactions and in particular how they can adjust the extent of their customer due diligence to the level of risk they have identified.

Bribery and Corruption

Banker sentenced to six years in prison for bribery scam

Mr Andre Ryjenko, a London-based banker has been convicted and sentenced, following a joint investigation by the City of London Police's Overseas Anti-Corruption Unit (OACU) and the Philadelphia office of the FBI.

Ryjenko was sentenced at the Old Bailey to six years in prison for receiving multi-million dollar bribes. Ryjenko was employed by the European Bank for Reconstruction and Development (EBRD) and had conspired to make $7.92million in corrupt payments by referring EBRD's clients to a complicit consultant based in the US. The commission payments received from the crimes were transferred to offshore accounts in Germany and Jersey. The consultant resultantly pleaded guilty to facilitating corrupt payments following an FBI investigation.

The Chief Compliance office of EBRD contacted the City of London Police's OACU in February 2010.

Peter Ratcliffe of the City of London Police’s Economic Crime Directorate commented that "This sentence sends out the strong message that corruption by its corrosive nature will not be tolerated and will be vigorously investigated and prosecuted regardless of where or how it occurs.”

Sanctions

UAE ambassador threatens further sanctions against Qatar

It is reported that the Gulf States are contemplating further economic sanctions against Qatar. The United Arab Emirates' ambassador to Moscow delivered a warning commenting that: "If Qatar was not willing to accept the demands, it is a case of 'Goodbye Qatar' we do not need you in our tent anymore."

The UAE, Saudi Arabia, Egypt and Bahrain have imposed an economic and diplomatic embargo on Qatar, claiming that Qatar's ruling family has been "harbouring terrorists and funding extremism for years."

Cyber Crime

FCA publishes new cyber security guide for firms

The FCA has published a new cyber security guide intended to help firms to become more resilient to the number, scale and sophistication of cyber-attacks.

The guide is intended to help firms to review their approach to cyber security. It provides a number of questions to allow firms to identify effective cyber security practices and also explains what firms need to do to report a cyber-incident.

Environmental

Mr. Robert Cooper, 78, of Hicks Leaze Farm, Chelworth was sentenced at Swindon Magistrates Court on Monday 5 June 2017 after pleaded guilty at an earlier hearing of operating a regulated waste facility without the necessary environmental permit (contrary to regulations 12 (1)(a) and 38 of the Environmental Permitting Regulations 2010) at the Farm between 9 April 2014 and 10 July 2014.

Checks with the Environment Agency’s public register confirmed that he did not have the necessary permits for the site.

Mr Cooper was given a 12 week prison sentence, suspended for 2 years and ordered to perform 200 hours of unpaid work. The court also ordered Mr Cooper to pay the Environment Agency’s full costs of £13,027.35

Health and Safety

NHS Trust fined £300,000 following patient death

Surrey and Boarders Partnership NHS Foundation trust has been fined for health and safety failings after a patient, Adam Withers, fell to his death.

Mr Withers had been detained as an in-patient at Epsom Hospital. On 9 May 2014, Mr Withers was in the courtyard with his mother while being observed by a nurse from inside the ward when he started to climb up onto the conservatory roof. The nurse was unable to prevent him climbing over the roof, attempts to talk him down failed and he fell, sustaining fatal injuries.

Surrey and Borders partnership NHS Foundation Trust pleaded guilty to breaching Section 3(1) of The Health and Safety at Work etc. Act 1974 and was fined £300,000 and ordered to pay costs of £16,769.00.

Roofing company fined following breaches of Work at Height Regulations

London based roofing company fined after a worker, Ali Mucoj, fell two storeys onto a concrete floor while he was completing roof work on an unguarded rear roof. Mr Mucoj suffered multiple injuries including internal bleeding on the brain and a broken left leg.

Wessesxmoor Ltd pleaded guilty to breaching Regulation 6 (3) of the Work at Height Regulations 2005.The company has today been fined £160,000 and ordered to pay costs of £7,580.85.

Two companies fined after putting a number of workers at risk in relation to heavy lifting

Two companies, Zero C Holdings Limited and Carter Training (services) Ltd, were fined after putting a number of workers at risk of harm when they failed to plan or identify risks in heavy lifting.

One of the workers was struck by scaffolding and suffered two fractures, a cut to the back of her head and bruising. The employees were using a mobile crane on a building project when the attachment turned on its side emptying the contents onto the workers.